Coffee Market Report
The March 2022 to March 2022 contract arbitrage between the London and New York markets narrowed yesterday to register this at 124.47 usc/Lb. This equates to 53.84% price discount for the London Robusta coffee market. This wide arbitrage will likely be viewed by price sensitive roasters as an attractive alternative discount for robusta against the comparatively higher value arabica coffee.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 945 bags yesterday, to register these stocks at 1,547,393 bags, with 95.97% of these certified stocks being held in Europe at a total of 1,485,077 bags and the remaining 4.03% being held in the USA at a total 62,316 bags. Of this, a total 708,026 bags, or 45.76% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 47.24% of these certified coffees, originating from Honduras. There was meanwhile no change to the number of bags pending grading to the exchange; to register 6,700 bags pending grading on the day.
It was a firmer day on the commodity markets yesterday, with the US Dollar steading ahead of the year-end holidays, trading volumes remained thin within the greater commodity market basket. The London Robusta Coffee, Corn, Soybean, Wheat, Gold, Silver, Platinum and Palladium markets ended the day on a firmer note, while the Sugar, New York Arabica Coffee and Cocoa markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.340 Sterling, at 1.133 the Euro and with the US Dollar buying 5.675 Brazil Real.
The New York and London markets started the day yesterday trading on a modest near to par firmer note. The New York market was seen to oscillate around par for the remainder of the early morning session. The London market attracted a degree of buying support early in the day to see the market trend firmer throughout the early morning session, before encountering resistance to drop back from the early morning highs. As the afternoon progressed both the New York market dropped back from the modest early morning highs to be set on a softer path for the afternoon session, while the London market also dropped back from the earlier highs of the day to be set on a softer path for the remainder of the day.
The New York market rebounded from the lows late in the day to see the market settle on a softer note at the close, while the London market retained some of the earlier in the day gains to settle on a modest firmer note at the close.
The New York and London markets are closed for the day today, ahead of the Christmas Holiday observed tomorrow, the 25th December. The New York market shall be trading solo for a shortened day on Monday while the London market shall resume trade on Tuesday 28th December.
The London market ended the day on a positive note and with 33.33% of the gains of the day intact, while the New York market ended the day on a negative note and with 52.22% of the losses of the day intact. This mixed close does little to indicate direction with the New York market settling on a softer note under thin volumes of trade as many market players are off the field of play for the Christmas holidays. This is likely to set the New York market trading solo for the day on Monday for a hesitant steady start to early trade, against the prices set yesterday, as follows:
LONDON ROBUSTA US$/MT NEW YORK USC/LB.
MAR 2353 + 14 MAR 231.20 – 2.35
MAY 2301 + 7 MAY 231.10 – 2.30
JUL 2285 + 2 JUL 230.40 – 2.25
SEP 2282 – 3 SEP 229.45 – 2.20
NOV 2284 – 2 DEC 227.85 – 2.15
JAN 2284 – 6 MAR 227.25 – 2.10
MAR 2279 – 6 MAY 226.75 – 1.95
MAY 2272 – 6 JUL 226.00 – 1.95
